Financial institutions, such as banks and credit unions, process checks. Larger financial institutions may process a significant volume of checks. Typically, since the Check 21 Act in 2003, most checks are routed and processed electronically as image files. A check may exist as an original, an image replacement document (IRD), and/or as an image item. An IRD is a paper document which contains an image of the check with additional information such as a new Magnetic Ink Character Recognition (MICR) line and endorsement information. Such check images presently conform with the American National Standards Institute (ANSI) X9.37 standard which is a standard format used in the banking industry which uses compressed Tagged Image File Format (TIFF) based images, typically using G4 image coding (e.g., a lossless, bitonal compression methodology) as the standard format. It should be appreciated that other such image standards may be used. Checks can be converted from paper to an image to an IRD.
It is possible, given this type of processing, for multiple instances of the same check to occur. In other words, duplicate copies of an imaged check may exist. Duplicate checks may also exist, for example, because of fraud, data processing errors, and printing errors.
If duplicate instances of a check exist, the financial institution may process and post each of the multiple instances. This may mean that the same check may be paid out more than once. Such multiple payments can lead to accounting issues, service problems, customer dissatisfaction, and losses due to fraud. For example, on-us checks (e.g., an on-us check is a check that is written against an account at the bank that holds the account) can be posted twice to the same account. Transit checks, written against an account at another financial institution (e.g., a bank that is different than the bank where the check is presented to) and received from a depositor or correspondent bank, may be presented twice to the paying financial institution for collection. Such double payments or postings can lead to accounting problems and may be indicative of fraud.
It should be appreciated that duplicate checks may be legitimate duplicates. Checks presented for return, re-presentment, or re-deposit are examples of such cases. Further, some check writers may create legitimate duplicates by not using unique serial numbers per account. For example, rebate checks may use the same serial number on a plurality of checks. Other such instances may exist.
Financial institutions may employ various methods for detection of such duplicate checks, typically known as duplicate detection methods. These existing methods may suffer from various drawbacks. For example, some current methods for duplicate detection may be performed manually. Such manual detection may include an operator comparing current checks against an historical database. This type of comparison may be time consuming and expensive. Further, operators may make errors and miss duplicate checks.
Duplicate detection may be performed automatically by a computer system. Typically, such automatic detection occurs during check processing. However, such detection, while automated, usually occurs late in the processing cycle (e.g., prior to posting). This means that resources are expending on processing a potential duplicate check and the duplicate detection is performed just prior to the last part of the processing. Such a method potentially consumes time and computer resources. Also, duplicate detection may not be performed on every type of check, such as transit checks sent for collection to other financial institutions.